offering flawed or non-existent testing; and illegally adding tests or services that were not requested (bundling);

Should Medicaid sanction fraudulent providers? The answer seems obvious. Policymakers, however, are often loathe to sanction Medicaid providers, especially those who care for the beneficiaries most in need.

“Local policymakers also proved reluctant to enact regulations or impose sanctions that would improve patient care. In place where there were acute bed shortages, officials were particularly unwilling to take on the industry. Even where there were egregious conditions, they would not shut down a facility because its inhabitants had no other place to live. Thus, the owners could hold elected leaders hostage because ‘throwing old people out of nursing homes was scarcely politically acceptable, unless organized alternatives were available–and they were not.’ ”